Kotler Mktman 11ce Ch04

8/4/2019 Kotler Mktman 11ce Ch04

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Co ri ht 2004 Pearson Education Canada Inc.

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Kotler on

Marketing

It is more important

to do what isstrategically right

than what is

immediately

profitable.


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Chapter Objectives

In this chapter, we examine thefollowing questions:

How is strategic planning carried out at thecorporate and division levels?

How is planning carried out at the businessunit level?

What are the major steps in the marketingprocess?

How is planning carried out at the productlevel?

What does a marketing plan include?


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Strategic Planning: Three Key Areas and FourOrganization Levels

Strategic marketing plan

Tactical marketing plan

Marketing plan


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Corporate and Division Strategic

Planning All corporate headquarters undertake four

planning activities

Defining the Corporate Mission

Establishing Strategic Business Units (SBUs)

Assigning resources to each SBU

Planning new businesses, downsizing, orterminating older businesses


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Planning Defining the Corporate Mission

Mission statements define which competitive

scopes the company will operate in Industry scope

Products and applications scope

Competence scope

Market-segment scope Vertical scope

Geographical scope


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Can you name a company that has

recently changed its product scope

or market segment scope in a very

public way? Was this an expansion

or contraction of scope?


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Planning Establishing Strategic Business Units

(SBUs)


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Table 4.1: Product-Oriented versus Market-Oriented Definitions of aBusiness

Company Product Definition Market DefinitionCanadian NationalRailway

We run a railroad We are a people-and-goods mover

Xerox We make copyingequipment

We help improve officeproductivity

Imperial Oil We sell gasoline We supply energy

Columbia Pictures We make movies We market entertainment

Encyclopaedia

Britannica

We sell encyclopedias We distribute Information

Carrier We make air conditionersand furnaces

We provide climate controlin the home


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Planning

Three characteristics of SBUs

Single business or collection of related

businesses that can be planned for separately

Has its own set of competitors

Has a manager who is responsible for strategic

planning and profit


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The Growth-Share Matrix

Relative market share

Four Cells

Question Marks

Stars

Cash Cows

Dogs

SBU Strategies

SBU Lifecycle


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Can you give an example of a Star

that skipped Cash Cow, and wentstraight to Dog status?



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Corporate and Division Strategic Planning

The General Electric Model



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Table 4.2: Factors underlying Market Attractiveness and Competitive Position in GE MultifactorPortfolio Model: Hydraulic-Pumps Market

MarketAttractiveness

Overall market sizeAnnual market growth rate

Historical profit margin

Competitive intensity

Technological requirements

Inflationary vulnerability

Energy requirementsEnvironmental impact

Social-political-legal

Weight

0.200.20

0.15

0.15

0.15

0.05

0.050.05

Must beacceptable

1.0

Rating =

(1-5)

45

4

2

4

3

23

Value

0.801.

0.60

0.30

0.60

0.15

0.100.15

3.70

BusinessStrength

Market shareShare growth

Product quality

Brand reputation

Distribution network

0.100.15

0.10

0.10

0.05

42

4

5

4

0.400.30

0.40

0.50

0.20

See text for complete table



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Planning

Critique of Portfolio Models

Planning New Businesses,Downsizing Older Businesses



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Planning

Intensive Growth



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Starbucks home page: Customers can request a

catalog of Starbucks products, subscribe to anewsletter, and shop online
http://www.starbucks.com/



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Planning

Integrative Growth

Diversification Growth Downsizing Older Businesses



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Give an example of a market

segment where integrative growth

would be preferable to growth

through diversification. Explain

why one approach is better

than the other.



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Business Unit Strategic

Planning Business Mission

SWOT Analysis

External Environment Analysis(Opportunity and Threat Analysis)

Marketing Opportunity

Buying opportunity more convenient or efficient

Meet the need for more information and advice

Customize an offering that was previously only

available in standard form



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Give some examples of companies

that have grown to dominate their

market segment by using technology

to make buying opportunities more

convenient and efficient.



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PlanningMarketing Opportunity Analysis (MOA)

Can the benefits be articulated to a target market?

Can the target market be reached with cost-effective media and trade channels?

Does the company have the critical capabilities to

deliver the customer benefits?

Can the company deliver these benefits betterthan any actual or potential competitors?

Will the rate of return meet the required threshold

of investment?



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Figure 4.7: Opportunity and Threat Matrices



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Planning

Internal Environmental Analysis

(Strength/Weakness Analysis)

Goal Formation

Strategic

FormulationStrategy



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Planning

Porters Generic Strategies

Overall cost leadershipDifferentiation

Focus



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Travelocitys Web site helps the consumer plan the

whole vacation flights, lodging, and car rental.com
http://www.travelocity.com/



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Operational Effectiveness and Strategy

Strategic groupStrategic alliances


Planning



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Planning Marketing Alliances

Product or service alliances

Promotional alliancesLogistical alliances

Pricing collaborations

Partner RelationshipManagement, PRM

Program Formulation and Implementation



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Planning

Feedback and Control



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The Marketing Process

Steps in the Planning ProcessThe marketing process

Analyzing Market Opportunities

Developing Marketing Strategies Planning Marketing Programs

Managing the Marketing Effort

Annual-plan controlProfitability control

Strategic control


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Figure 4.10: FactorsInfluencing CompanyMarketing Strategy


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Product Planning: The Nature and Contents ofa Marketing Plan

Contents of the Marketing Plan

Executive Summary

Current Marketing Situation

Opportunity and issue analysis

Objectives

Marketing strategy

Action programs

Financial projections

Implementation controls


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Sample Marketing Plan: Sonic PersonalDigital Assistant

Current Marketing Situation

Opportunity and Issue Analysis

Objectives

Action ProgramsFinancial Projections

Product Planning: The Nature and Contents of

a Marketing Plan


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Implementation Controls

Marketing Strategy

Positioning

Product Management

Pricing

Distribution

Marketing Communications

Marketing Research

Product Planning: The Nature and Contents of

a Marketing Plan

Kotler Mktman 11ce Ch04

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